Introducing the Founders Fund

If you’re familiar with our origin story, you’ll know that our operation begin a little differently than most. We weren’t blessed with millions in the bank or investor dollars behind us, and almost every bank laughed us out of the building, sighting lack of industry experience as our fatal flaw. Thankfully, our first venture, a small e-commerce software business known as IgnitionDeck, was sturdy enough to use as collateral for non-traditional financing, and had sufficient profits to help fund the initial purchasing and demolition.

Unfortunately, lengthy permitting delays, and frequent ones at that, meant that we were paying interest on capital that we couldn’t deploy, and to complicate things further, we were forced to lease additional space in order to meet specific functional requirements. This meant that the scope of the buildout would increase, and costs would double, all before we even purchased a single piece of brewing equipment.

We made a conscious decision early on to spend the bulk of our funds on the taproom, believing that size of brew system was less relevant than the atmosphere we wanted to create as the first craft brewery, and really the only craft beer hotspot, in our small town of Apollo Beach. As a result, we started with a (very) small 1.5 BBL system with limited capacity, a cold room instead of cold refrigerant (glycol), and a walk-in cooler that was about half the size we truly needed.

Still, fortune favors the bold, and despite the never-ending series of challenges we faced, we always found a way to make it work. It was certainly a tough couple of years, and those of us that remain have more than a few gray hairs to show for it, but all in all, our belief in the company never wavered, and we now have an incredible product to show for it.

Our brewhouse has doubled twice, the team has continued to grow, and most importantly, the quality of our liquid has never been better. This is made evident by the fact that we’re not only selling more beer in-house than ever before, but we’re also shipping more beer to our distributor than ever before.

Managing Growth vs Balancing Cash Flow

This of course leads us to today, where we face the same type of challenges, but at a new and different scale:

  • We need to purchase a larger brew system in order to keep up with demand.
  • We need to get unhealthy debt off the books in order to improve our cash position.
  • We need to continue renovating our existing taproom, and finance construction of our expansion.
  • We need to increase payroll, adding more salaried positions, including sales, marketing, and operations.
  • We need more inventory, as we are constantly running out of little things, like t-shirts, hats, tap handles, and even COGS.

The good news is that we are a healthy business that is thriving and growing. The bad news is that our growth has been throttled by available cash on hand, resulting in lost opportunity and revenue.

Our plan for fixing this is quite straight forward…

Modern-Day Investment Funds

Our customers have been asking us for investment opportunities since day 1, and each time we’ve repelled their advances by saying we weren’t yet ready. We believed, and still do, that taking money from someone is more than just a transaction; it’s a huge and binding commitment that marries parties together, and rushing into that is worse than being short on cash or taking bad debt.

There are also dozens of legal loopholes to navigate when selling shares (equity), none of which make sense at our current scale.

Lastly, equity investors need to cash out eventually, and we are so far from an exit event that we’d be foolish to sell shares at a time when our valuation would not match the investment we have made in this company.

That said, equity investment is not the only type of investment. Have a look at companies like LendingClub or Prosper, where those with a few thousand in cash can invest in varying sets and categories of personal and business loans. The downside here, of course, is that the investments are made blind, and investors cannot see, much less interact with the people and companies they choose to invest in.

Imagine then, an opportunity wherein you can invest extra funds in a business you know and love, gaining a guaranteed return in the meantime.

The Four Stacks Way

This is what we’re offering today, in the form of the Four Stacks Founders Fund.

The program works like this:

  • Investors pledge funds in $1,000 increments, with a minimum investment of $5,000, and maximum investment of $100,000 (please contact us privately if you wish to invest more).
  • These funds are secured by the business and its assets.
  • Legal documents will be drafted by our attorney, Sheryl Hunter, of Hunter Business Law.
  • The funds will be repaid over a period of 3-5 years, depending on the total funds raised, with a guaranteed return of 10% per annum.
  • Investors will be given the option to defer a portion of distributions into future fundraising rounds at a discount.
  • Investors will be given first access to potential future equity rounds.
  • Investors will be given special Black Edition Founders Fund swag (hat, t-shirts, glassware, etc).

How it Works

We will be opening this program in three rounds:

  1. Pre-sell round (now). Investors can submit a pledge online and receive a copy of the term sheet for review.
  2. Due diligence round. Investors may review the term sheet with their attorney, and make a commitment to invest.
  3. Closing round. Investors will meet with our attorney to submit funds and sign the final loan agreement.

Our goal is to raise a minimum $100,000, which is sufficient to pay off existing debt and save 29% in monthly operating expenses. Any additional funds we raise will be used to fund our expansion, including, but not limited to, taproom construction/renovations, brew system quality/capacity enhancements, and inventory.

Obviously, this is a very basic explanation, and we will be happy to provide a more detailed plan, and answer specific questions in a private setting at a date & time TBD.

We know that this opportunity isn’t for everyone, but we do hope those of you that can join us will at least consider it. In return, we pledge to uphold our commitment to you, and make sure that your experience as an investor matches your experience as a customer. May we work together to continue shedding a light on Four Stacks, its commitment to craft beer, and in return, the community of Apollo Beach!

Ready to learn more? Click the button below to make a pledge and receive a copy of the term sheet.